Considerations Regarding Improving Business Competiveness From An Entrepreneurial Perspective

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1 Considerations Regarding Improving Business Competiveness From An Entrepreneurial Perspective Manoela POPESCU Faculty of Touristic and Commercial Management, Dimitrie Cantemir Christian University, 174 Splaiul Unirii Street, Bucharest, Romania Luminiţa Cecilia CRENICEAN Faculty of Touristic and Commercial Management, Dimitrie Cantemir Christian University, 174 Splaiul Unirii Street, Bucharest, Romania ABSTRACT Known is that the competitiveness of firms in the era of globalization is possible by developing an entrepreneurial culture, which prevail innovation, creativity and knowledge accumulation. Moreover, global entrepreneurship studies conducted by GEM (Global Entrepreneurship Monitor) and other studies and research in recent years for assessing entrepreneurial phenomenon shows its importance in growth and business competitiveness. But entrepreneurship resources triggers synergy individuals, communities, economic actants, communities, areas and national entities. Ability to recognize and exploit opportunities, regardless of resources available to individual and environment of occurrence, plus the flexibility, creativity, innovation, will, courage and determination generates new business development, innovation networks, the new products and services etc. KEY WORDS Competitiveness, business, entrepreneurship, entrepreneurial culture JEL CODES M21, M14, O16 1. Introduction In the current situation of a difficult economic climate, knowledge economy requires creative ideas and innovative solutions in all fields, knowing that competitive socio-economic entities are those that resist and even grow under conditions of global economic crisis. Moreover, any economic competition becomes increasingly fierce competitive desire is any company. Therefore, to ensure the competitiveness, companies are struggling not only to continuously adapt to market conditions and its requirements, but to create conditions favoring their development environment. Currently, in the knowledge based economy situation, increasing competitive context, technological change, economic liberalization, the growing importance of innovation and creativity help verify the hypothesis that encourage and promote entrepreneurship results in increased business competitiveness. Moreover, the global economic crisis has brought to the attention of all entities entrepreneurial phenomenon, as the generator of economic growth and economic 9

2 competitiveness. Actually, the knowledge based economy generates new models of organization of economic activity and entrepreneurship spirit triggers their synergy, which makes achieving high performance by any entity. As such, in achieving a competitive the focus is on three key factors: knowledge, innovation and entrepreneurship. In this context, the entrepreneur represents key source of innovation, creativity and change, driven by economic growth. The concept of business or entrepreneur is related to knowledge, relevant information, flexibility, adaptation, creation of conditions and opportunities in the hope of ensuring a real competitiveness. Purpose of scientific endeavor was undertaken to demonstrate not only the importance and the need to address business competitiveness in terms of entrepreneurship, but to identify key aspects of entrepreneurship relevant to business competitiveness. Study hypotheses are: individuals with entrepreneurial spirit see opportunity where others see problems, entrepreneurs have spirit of initiative, action, though with entrepreneurship; person who creates, dealing with a business is an entrepreneur, entrepreneurship refers to the action, which means that it is a process not a static phenomenon, entrepreneurship generates a way of life, some life strategy, turning positive attitude, action and spirit of initiative helps to increase business competitiveness. Using a series of quantitative and qualitative methods (interviews, case studies, quizzes, and tests), research has shown that entrepreneurship is a key factor in ensuring business competitiveness and growth. 2. Entrepreneurship and Business Of course, it is known that entrepreneurs help create jobs and generate competitiveness and therefore represents a focal point for local communities. In fact, studies have shown that in poor or developing countries, the main obstacle to growth is lack of entrepreneurship that can trigger resources synergy of those countries (capital, labor, information etc.). Of course, entrepreneurship is not only about the creation of new enterprises, but also developing existing ones. In both cases, improve business development activities; help boost skills, knowledge and creative development, relationship inventory of the individual's organizational framework. Obviously, just as important is the existence of competitive markets and specific mechanisms, absolutely necessary event of successful entrepreneurship [1]. In fact, research has shown that entrepreneurship is both learned and inherited, learned through education and training or through self-education, that legacy, in which individuals have specific personality traits of a successful entrepreneur and a certain attitude, proactive behavior, and action-oriented leadership. Of course, entrepreneurship can occur due to opportunities because of a strong motivation (lack of resources necessary for survival, lack of employment, job dissatisfaction, lack of risk or their existence etc.), or due to socio-economic environment. As such, entrepreneurship manifested individually contribute to business competitiveness Initiating and developing new business (where the entrepreneurial spirit of entrepreneurship in the form) or by developing new products, new methods, methods of work organization, the organization distribution products and other forms of action, creativity and individual innovation and/or collective success creating an entrepreneurial culture. In the knowledge economy entrepreneurship requires perseverance, ingenuity and a predisposition to take towards the objectives set. Also, entities must be based on power and their ability in order to identify and exploit opportunities arising in the environment in which they occur or even create them, making best use them. Obviously, the entity must have a certain attitude, 10

3 personality (temperament) to take something and be successful. In fact, any entity to generate changes that affect not only the entity, but also other entities, and even society in general. In the specific literature there is sense that entrepreneurship occurs only in a business (company, firm, company), in this case being the main form of entrepreneurial business. However, research shows there entrepreneurship and outside the organization, because it is both an essential attribute of an individual, a specific mindset and a matter of choice for any entity to behave proactively to take advantage of opportunities to have a positive attitude, the winner. Entrepreneurship is an entrepreneurial thinking, a way of showing specific action. Therefore, individuals with entrepreneurial spirit are both small and medium business owners and employees of large companies. Obviously, business, as a profitable organization, is the major institution of economic sphere and its key role is to produce goods and services necessary to maintain a certain standard in society [2]. In the knowledge economy, businesses compete with each other to meet consumer needs and requirements. The main business objectives are what differentiate each other. Of course, goals change from one period to another, for the same business, according to certain environmental conditions. With a plan, human resources, material and financial resources and an efficient management team, any business can achieve its objectives. We can say that the whole point of business is in bigger gains in a short time. Those interested are still other needs than those that can be satisfied by the goods and services. Businesses come to meet these needs, either directly or indirectly. That s why business effectiveness is not measured in terms of economic performance, but in terms of economic and social performance [3]. Seen by the public as conservative elements, big business are the main means of transforming the science and technology in goods and services necessary to society. To fulfill this role with the company, they have trained a number of significant social changes. It can be said that businesses that are considered economic and social performance, are trying to satisfy all interested (shareholders, employees, neighboring communities, suppliers, customers, state, trade unions) who have a higher purpose (creating jobs employment and providing goods and services) and are connected dynamically to economic and social environment, having high standards [4]. As such, businesses are now the main source of power and influence in any economy. In developed countries, business organization has become the most important economic institution and the most powerful force for social change. That is why the focus is on increasing business competitiveness. The literature indicates that entrepreneurship relates to a particular type of behavior that includes: initiative, organization and reorganization of socio-economic and accepting risk and failure. Also among those who exhibit entrepreneurial characteristics being found: determination and perseverance, desire to succeed/win, seeking feedback, persistent problems, initiative, responsibility, opportunity-oriented, optimistic, confident, orientation opportunities, tolerance for failure, creativity, spirit of innovation, independence, teamwork, realistic vision, mind management, high level of energy independence. The empirical study revealed that entities decide to have an attitude, to do something to achieve success in their field of action. Often the difference between achieving or missing goals is given attitude. Thus, we can say that entrepreneurship is therefore induced by the attitudes, motives, abilities and psychological features of an individual. Entrepreneurship means the ability to recognize and exploit opportunities, regardless of resources available to an individual at a time, confident of success, flexibility and willingness to succeed. 11

4 On the other hand, entrepreneurship, whether learned or inherited, is a matter of choice of entity, according to the theory of "administrative man" by Herbert Simon [5], applying its innovative concepts of the theory of human choice and administrative decision that solving concrete organizational problems. Individual chooses to have a winning attitude, to make conditions favorable to environmental opportunities, create and innovate in its activities so as to achieve success. In fact, entrepreneurship is manifested in a body at the enterprise/company or society. Obviously, existing research showed that entrepreneurial spirit and potential exists in all environments and fields, identifying OECD in this regard a number of specific indicators, namely: determinants of entrepreneurship, namely the contextual factors that may positively influence attitudes, actions, innovation, start-ups, new markets: access to finance, entrepreneurial skills, market conditions, specific regulations, entrepreneurial culture, entrepreneurial climate etc.; entrepreneurship performance, showing that elements of the dynamics and evolution of new business: establishing a firm rate, the rate of bankruptcies, types of firms, employment, etc. working population; impact generated by entrepreneurial activity, i.e. long terms economic and social effects: job creation, economic growth, poverty reduction. Therefore, ways to promote and develop entrepreneurship can be structured at both national and organizational/community and individual. At national level, all major policies to stimulate entrepreneurial capacity focus on macroeconomic conditions and access to finance. But the study shows that entrepreneurship requires a shift to reward nationally operating entities, seeking new methods and models for success and develop their skills, capacities and positive attitudes towards objectives. And the reward system requires certain specific framework conditions appreciation primarily values (data including entrepreneurial skills). Framework to ensure these conditions are relevant legal regulations, administrative and specific markets and support programs of governments and other organizations. The relationship between entrepreneurship and growth phenomena, statistical perspective is highlighted by analyzes of the Global Entrepreneurship Monitor (GEM). Measuring business activity in a country, GEM (released in 1999) suggests that countries with high level in terms of entrepreneurship, presents a high level of growth [6]. The "Global Entrepreneurship Monitoring" project, applied in Romania for the first time in 2007, meant to conduct a scientific entrepreneurship of the adult population according to international scientific criteria. As such, GEM analysis shows the share owners of new firms in the population aged years, national entrepreneurship, entrepreneurship motivation, and other statistics on entrepreneurs category, without addressing the broader relationship between the spirit entrepreneurial and business competitiveness. 3. Aspects of Business Competitiveness in the Knowledge Based Society Specialty literature manages a multitude of definitions, approaches, studies and research in terms of competitiveness, the determinants of competitiveness, competitiveness indicators, and relationships in which competitiveness is concerned, and effect or both. For example, in company theories, holders of interests theory states that managers may not maximize firm value, if ignored, objectives, needs of all stakeholders: shareholders, employees, suppliers, creditors, customers, 12

5 communities, etc. In other words, the competitiveness cannot be achieved by an entity, if not taken into account the interests of the main partners, at least. Competitiveness is a complex concept that can be addressed at individual, organizational and societal or general. Thus, in general, competitiveness requires entities to maintain the ability to compete and achieve economic benefits in the context of that environment. This general approach applies to both individual and organizational level. At the societal level, however, expresses the capacity and competitiveness of that country's ability to effectively use spotted and identified opportunities globally. Thus, competitiveness is characterized by the 12 Pillars of Economic Competitiveness: institutions and institutional environment (strategies, policies, quality, attitude of governments, corruption, transparency, the judiciary, honest practices, management of public financial institutions and private), infrastructure (grade development, quality, service, network), the macroeconomic environment, health and basic education (health and primary) education, higher education and training, goods market efficiency, effectiveness (and flexible) labor market, financial market development, technological readiness, market size, innovation, business sophistication. Those pillars of competitiveness can be grouped into three categories or stages of development of economic competitiveness: determinants (institutional environment, infrastructure, macroeconomic environment, health and basic education), determinants of efficiency (higher education and training, goods market efficiency, market efficiency labor, financial market development, technological readiness, market size) and determinants of innovation (innovation and sophistication of business). Research on competitiveness has revealed a number of interrelated factors of competitiveness: profitability, investment, improving quality (products and activities), expansion and diversification, proactive behavior. But if competitiveness is addressed from the perspective of modern management, i.e. in terms of two key factors: profit entity and its impact on the market - through products and/or services and proactive behavior, it is essential to increase competitiveness of the global crisis. This is because profit is not just a firm purpose, but only means that it can ensure survival and/or development. In this sense, in the actual economic crisis, the primary objective of firms is to maximize customer satisfaction and all concerned. Therefore, companies that are based on surveys of customer needs (internal and external) will be able to identify competitive advantages and to act so as to capitalize on market opportunities and even to create conditions for increasing competitiveness, promoting entrepreneurship and innovation. Certainly, the competitiveness of organizations in the knowledge economy is determined by how organizations manage to spur technological innovation, to develop business relations, to promote and develop specialized skills type learning networks. This is because the knowledge economy is characterized by rapid change of paradigms: manufacturing processes, organization (work) and management organizations. As such, the markets in which firms operate are global, dynamic, requiring the creation of business networks to develop, promote entrepreneurial culture, developing flexible hierarchies, flexible organization of production and work. Research highlights the importance of investment in increasing business competitiveness. Course, are concerned not only investments in high technology equipment, communications and infrastructure, but rather, investments in human resources. As such, investments in education and human resources generate interest in self-education to encourage and promote entrepreneurship event, which increases business competitiveness. Thus, through education, according to European documents, can be developed managerial skills of individuals, social skills, entrepreneurial skills 13

6 and self development and personal auto efficiency (increased self-confidence, increased motivation to achieve high performance, increase desire and motivation to learn to think independently, critically and self-critical, constructive and autonomous). 4. Relational Model of Entrepreneurship and Business Competitiveness The study undertaken has led to few concrete results that can be used to build a relational model of entrepreneurship and business competitiveness. Thus, individuals surveyed have some entrepreneurial traits, have information on the phenomenon of entrepreneurship (especially the Internet), have attended or plan to attend business training, believes that investment in training and development of entrepreneurial skills are the major source manifestation of entrepreneurship, believes that socio-economic environment has an impact on encouraging and promoting entrepreneurship, consider that the positive, action oriented, flexibility, desire for success, motivation and desire continuous improvement and lifelong learning initiative, will contribute to the competitiveness of their fields of activity (business), believes that the opportunities requires financial resources (obtained from structural funds, savings, loans or credits). The proposed model is inspired by the sociological perspective entrepreneurship research conducted by McClelland, who suggest that, regardless of variations in economic development, individuals who see opportunities where others see problems, almost always will find ways to maximize their actions and results [7]. Also were considered models developed by Wennekers and Thurik (1999) [8] and GEM [9] conceptual model of the relationship between entrepreneurship and economic growth. The basic idea of the model is best expressed by M. Porter: "The invention and entrepreneurship is a national competitive advantage" [10]. But always, the event entrepreneurship organizational framework is directly dependent on environmental conditions internal (organizational culture, characteristics of the organization, work group, managers, owners, personalities within the organization, processes of recruitment, socialization and integration, the beneficiaries of the organization, philosophy of the organization, the motivation, organization management, models of organizational behavior, organizational relationships) and external environmental conditions (technical, technological, socio-demographic, economic, legal, institutional). As such, the model addresses four levels of analysis of the impact on increasing business competitiveness entrepreneurship: the individual, the community/group, organizational level (company, firm, company) and societal level (macro level). Entrepreneurship is not just specific individuals, but groups or companies, where the sense of entrepreneurial firms. From entrepreneurial traits held by entities can be considered to be relevant not only psychological features, but also the general conditions and necessary to encourage and promote entrepreneurship event entrepreneurship: entrepreneurial culture, specific institutions (for example: National Council of Competitiveness) cultural institutions, financial markets, technology, infrastructure, management, flexible labor market, government policies to support and promote entrepreneurial phenomenon, education and training, access to finance, markets, structures, education and training, entrepreneurship favorable political environment. So positive attitudes, goal-oriented and performance, will generate actions using the skills and competencies held for innovation and creativity manifestation in different forms, sizes and areas, thus contributing to new business or ideas for products/services, penetration new markets with new products, new ways to do things differently, but in a positive, powerful. Of course, all this will lead to more 14

7 competitive entities, to raise living standards and civilization, which will generate new spiral synergistic action, positive. 5. Conclusions Competitiveness resulting in increased productivity in resource use and the use of knowledge generation and exploitation of innovations. While entrepreneurship, defined as the process of creating value by bringing together a unique set of resources, exploitation of opportunities is the essential factor of economic development and prosperity. Entrepreneurship is present in any organizational framework, regardless of its size and beyond. Entities that exhibit entrepreneurial spirit are those that are socially responsible and achieve high performance. Although the approach is the notion that entrepreneurship is a necessity in certain situations, such as rapid changes in the technology, the customer values, situations of uncertainty, chaos, crisis, high complexity, etc., however, starting from the direct relationship between competitiveness, entrepreneurship and entrepreneurial orientation is essential for any business and economics. The study provides a broad framework for action and practical scientific approach of analyzing the impact of entrepreneurship on ensuring business competitiveness, offering courses of action to develop models to relate entrepreneurship and business competitiveness, to reveal different ways of enhancing the full human potential and change the attitude entities success. In this respect, require at least the following lines of research: analyzing the relationship between entrepreneurial orientation and performance of the business, identifying the basic conditions for expression of entrepreneurship, identifying patterns of learning entrepreneurship in terms of personal efficiency. References [1] [2] Ionescu Gh. Gh., (1997), Business Culture. American Model, Ed. Economică Publishing House, Bucharest. [3] Popescu, M, (2003), Business Culture, Ed. Economică Publishing House, Bucharest. [4] Popescu, M, (2003), Business Culture, Ed. Economică Publishing House, Bucharest. [5] Simon, H., (1997), Administrative Behavior, 4 th Edition, Free Press Publisher, English, Page 45. [6] [7] McClelland, D. (1998). Human Motivation, Cambridge University Press. [8] Carree, M., Thurik, A. R. (2002). The Impact of Entrepreneurship on Economic Growth. In Zoltan Acs and David B. Audretsch (2003), International Handbook, of Entrepreneurship Research, Boston/Dordrecht: Kluwer Academic Publishers. Page 20. [9] [10] Porter, M.E. (1990) "The Competitive Advantage of Nations", Free Press, New York, page